Dive Brief:

• The Surface Transportation Board proposed new rules Friday that would allow rail shippers to more easily petition regulators to intervene in cases of substantial service declines.
• Among other changes, the rules would ease a requirement that shippers must have a commitment from an alternative rail carrier when seeking an STB order to remedy service. Under the proposal, shippers would instead have to provide a list of possible alternative carriers.
• The proposal, which is subject to an initial public comment period until May 23, comes after the STB ordered several Class I carriers including Union Pacific and CSX to appear at a two-day emergency hearing on recent service problems set to occur this week.

Dive Insight:

Shippers — and other federal agencies — have pushed the STB to take action and address congestion and other service disruptions in the rail industry. Railroads including Union Pacific and BNSF have struggled in recent months to handle a surge in volume, and have taken steps to reduce the number of cars in an effort to relieve congestion.

Businesses and agricultural producers say missed switches, equipment shortages and major delays have in some cases led to production shutdowns. U.S. Agriculture Secretary Tom Vilsack asked regulators in a letter last month to improve service in part by obtaining remedy plans from carriers and collecting more granular service data.

"From equipment shortages to congestion, disruptions to agricultural shippers have become a constant, and current rail service disruptions are at a breaking point as railroads have cut assets in locomotives and crews and focused on operating ratios and profitability," he wrote.

The STB's proposal is meant to streamline the process for shippers to file petitions requesting regulatory intervention in cases of major service declines. In addition to tweaking the requirement regarding alternate carriers, the proposal shortens the time for carriers to respond to a petition and establishes a timeframe for a board decision.

The rules also clarify that the STB can take action even when no shipper has filed a petition. In cases of major service issues, the board has the power to require common use of railroad facilities or direct the handling, routing and movement of a carrier's traffic.

The proposal comes as the board is set to hear from shippers and carriers in a two-day emergency hearing on rail service issues that could lead to further regulatory action.

"The Board expects the railroads to explain the actions they will take to fix these issues," STB Chairman Marty Oberman said in a statement. "The Board will also consider stakeholder views on how it can use its authority—including measures to address emergencies, increase transparency, and promote reliable service—to ameliorate problems on the network."